Apple stock target raised as Citi sees continued market share gains

Investing.com -- Citi has increased its price target on Apple (NASDAQ: AAPL) to $365 and maintained its Buy rating on the stock in a note on Monday, citing the company's ability to gain market share in a challenging devices environment and its capacity to implement selective price increases to protect margins.

Analyst commentary noted that smartphone and PC markets are likely to decline by mid-to-high teens, but said Apple "continues to outperform the broader smartphone market through share gains, design-driven demand, and strong positioning in the mid-range price segment via promotions and subsidies."

On pricing, Citi noted that Apple raised prices on several products mid-quarter amid component cost increases and is evaluating additional memory suppliers to diversify supply.

While iPhone prices remain unchanged for now, Citi expects price increases in the upcoming September launch cycle, "with more focus likely on the higher end models where demand is more resilient." The firm also flagged an expected foldable launch in the fourth calendar quarter.

Citi said Apple Intelligence is "unlikely to drive a significant upgrade cycle in the near term," but argued that enhanced Siri AI capabilities should increase user engagement and support long-term growth in high-margin services revenue.

The September iPhone launch was identified as "an important catalyst that could further strengthen investor sentiment."

On services, Citi noted that Sensor Tower App Store revenue in the June quarter grew 3% year-on-year, tracking below company guidance, but said it views iCloud and advertising as "stronger drivers for revenue growth."

The raised price target reflects "stronger margin expectations" and rolled-forward financial estimates.

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